The Central Bank of Nigeria (CBN) has commenced a new phase of direct sales of US dollars to Bureau De Change (BDC) operators at a rate of N1,021 per dollar. This initiative was disclosed in a circular signed by the Director of the CBN’s Trade and Exchange Department, Hassan Mahmud.
The circular, posted on the CBN’s website, outlined the sale of $10,000 by the CBN to BDCs at the specified rate, with BDCs mandated to sell to eligible end users at a spread not exceeding 1.5 percent above the purchase price. Furthermore, the circular directed all eligible BDCs to commence payment of the Naira deposit to designated CBN Naira Deposit Account Numbers from April 22, 2024, onwards, and to submit confirmation of payment along with necessary documentation for the disbursement of foreign exchange at respective CBN branches.
The CBN’s move comes amidst a slight depreciation of the naira against the dollar following a period of gains. In late March, the CBN similarly sold $10,000 to eligible BDC operators at a rate of N1,251/$1. The bank cautioned BDCs against breaching the terms of dollar sales, emphasizing the enforcement of sanctions, including outright suspension from further participation in sales, for defaulters.
The fortunes of the naira have fluctuated significantly since President Bola Tinubu assumed office in May, with inflation rates soaring and the cost of living skyrocketing. Although Nigeria’s currency had depreciated to approximately N1,900/$ at the parallel market some months ago, recent weeks have witnessed a strengthening of the naira against the dollar.
In tandem with the direct sales of US dollars, Nigerian authorities have intensified efforts to crack down on cryptocurrency platforms like Binance and illegal BDCs. On March 1, the CBN revoked the licenses of 4,173 BDCs due to compliance failures, underscoring the regulatory measures implemented to ensure financial stability and compliance within the foreign exchange market.
